CNN LIVE EVENT/SPECIAL

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED. CAROL LIN, CNN ANCHOR: Last Tuesday's terrorist attacks clipped the wings of America's airlines and yesterday, Wall Street sent their stocks into a tailspin. Today, airline executives are meeting with Transportation Secretary Norman Mineta to talk about the industry's future. Frankly, they want a bailout.

American Airlines, the nation's largest, is expected to announce layoffs sometime this week. And Northwest Airlines is expected to follow suit. Continental and U.S. Airways have already laid off a total of 23,000 employees. And like most airlines, they are cutting back their schedules by at least 20 percent. Several members of Congress are saying the government must help.

James Oberstar of Minnesota put it -- frankly, he put it pretty bluntly, he said without direct financial intervention by the government, we could see the financial liquidation of the airline industry. Some of those airliners losing $300 million a day.

Airline stocks weren't the only ones taking a beating on Wall Street yesterday. With very few exceptions, stocks were down across the board. For more on what's in store for Wall Street today, and we're going to try to be optimistic, CNN's Amanda Lang joins us from the New York Stock Exchange.

Good morning, Amanda, hopefully you have some sign of the future by actually looking at the futures trading.

AMANDA LANG, CNN CORRESPONDENT: We do have futures. They're down this morning at this hour but they're not down in a way that indicates any major sell-off. We've got, at the moment, the Nasdaq futures are off 7, S&P indicate a down 4.4. We have, on any regular trading day, seen worse than that.

Yesterday's decline, 7 percent for the Dow, was not as bad as many had feared. And in fact, some market watchers heading into the session noted that the European market averages were down about 7 percent during the period that the Big Board was shuttered. Well, the Big Board had to catch up so not surprising to see that kind of decline.

According to many, you want optimism, one place to look is the volume that passed through here. It was a record, more than two billion shares, and it, of course, as well as being an all-time high, tested the systems here. There was some concern about whether, because of damaged phone and data lines, the New York Stock Exchange would be able to cope. It did, and many are very pleased with that this morning at the very least.

LIN: Well many can probably take some comfort in some of the predictions yesterday morning before the market opened. Analysts were saying that defense stocks would be hot and consumer staples would be hot and many of the banking -- the banking sector would decline. What are the hot and cold sectors that you see today? Do you think that's likely to stay the same?

LANG: Some of them will stay the same. You mentioned the airlines. They may stay under pressure because the fundamentals for that group, their actual businesses are being hurt. Investors are trading off that news. But some of those that have been strong may also stay strong. That's the good news. We did see energy stocks rallying, mining stocks, as gold is seen as a hedge against equities, and yesterday, some of the buying was in defensive names, typical stocks that investors buy when they want to get out of the flashier names. We call them the eat them, smoke them, drink them stocks: Coca-Cola, Philip Morris, the pharmaceuticals. That's a really good sign because it means that investors were still looking for a place to put their cash, they weren't getting out of the market all together. Those may continue to be strong.

Of course the other big question is, and many are wondering if and when this will happen, some of these names just look too attractive not to buy. The market's at three years -- three-year lows, some stocks are at three-year lows, and the question is do investors just look at those price levels and think it's time to get back into them?

LIN: Sure. And in that twisted logic that we always see on Wall Street that people are actually saying that this is a good sign that so much pessimism can actually create a bottom for this market and that investors can finally look forward to some sort of rally down the road. In other words, it just can't get any worse.

LANG: Absolutely. It is a bit through the looking glass, and it's really about the longer term. It's a reminder that trading days are just that, they're days, and that overall, as far as we know, markets tend to rise and people are just waiting for that moment when these markets can turn around. It's going to come back to the economy, of course, and there's still many questions to be answered about the longer-term effects of last week's events and global events. There's some concern about global recession. That will have an affect, but you're dead right that we set the stage for what they call a reversal here. It can be painful setting that stage for many investors, but it's somewhere we need to get. We needed to get there before last week so that's still definitely in the mix here.

LIN: All right. Thanks so much, Amanda Lang, reporting live from the New York Stock Exchange. Good to see it open again -- Leon.

HARRIS: All right. Let's go over to the Nasdaq and check on the mix over there. Fred Katayama checking in after a day of almost 7 percent of a loss there on the Nasdaq market as well.

Morning, Fred.

FRED KATAYAMA, CNN CORRESPONDENT: Good morning, Leon.

Yes, you mentioned that 7 percent loss. It does, if you look at the number itself, it does seem like a disaster. But actually some traders took comfort in the fact that the trading systems were open, that they worked well and that whatever sell-off we saw was orderly, wasn't in the volatile swings that we often see that are characteristics when trading opens following some cataclysmic event.

Today we expect to see the Nasdaq open flat to slightly lower based on how futures indications are trading right now. Obviously a shot of the Nasdaq outside right now. We're seeing business return back to normal; however, just outside the Nasdaq, these still -- there is a lot of yellow tape basically sealing off the premises so that a lot of travelers who normally look through our windows at the Nasdaq marketsite will be kept at bay.

Now today, more companies have announced stock buybacks, and so we could see some action in stocks such as Applied Micro Circuits. It says it's buying back as much as $200 million of its shares over the next 12 years. Yahoo! has also said it has bought back some of its stock. And Oracle, the database software maker, says it'll buy back aggressively. One other stock you want to keep an eye on is Immunex, that is the biotech concern. It will be added to the S&P 500 after the close of trading on Thursday -- Leon.

HARRIS: Fred, let me ask you before we let you go, we see these companies stepping in right now to buyback their own stock because prices right now have been so depressed and because of yesterday, they may be getting some big bargains here. Are you getting a sense that this is just basically a market for companies and for professionals right now and not for your average trader who wants to get in right now and look for some bargains?

KATAYAMA: Well, you know, it's funny you mention that, Leon, because I spent the day outside the Nasdaq marketsite yesterday talking to a lot of small investors. And for the vast majority of them told me that they are holding for now, that yesterday they did not buy or sell, but there were a few small investors who said if anything, they're going to be buying today. A one person said he was going to be buying defensive stocks -- defense stocks, rather, even though they've had a run up yesterday. So it makes me wonder, who was selling yesterday? Was it the professional investor that sold?

HARRIS: Interesting. Well we'll see how things shape up, only about three hours away. Fred Katayama, thanks much. We'll talk with you later on -- Carol.

LIN: Well, the U.S. economy was sinking before those terrorist strikes last week and frankly, at that time, consumer spending helped provide the lifeline.

Well, CNN's Casey Wian is seeing out there on the streets that shoppers are now pausing.

(BEGIN VIDEOTAPE)

CASEY WIAN, CNN CORRESPONDENT (voice-over): Some called it patriotism, others therapy. Whatever the reason, many Americans went shopping over the weekend. At the Glendale Galleria, traffic returned to near-normal levels after a sharp drop following Tuesday's terrorist attacks.

UNIDENTIFIED MALE: We have all the confidence in the world, and we can't let them ruin our life. We have to leave our life the same way that we were living before. Because, if we change it, then they are going to win.

UNIDENTIFIED FEMALE: I guess, trying to get break from everything. And just, you know, I had to pull myself away from the television.

WIAN: Most retailers, including industry leader Wal-Mart, report traffic returning to stores after a lull last week, but sales slightly lower. Reminders of the attacks are everywhere, from mall memorials to retailers collecting Red Cross donations.

The tragedy brought back painful memories to the manager of this Sears store in Northridge, which closed for 10 months following the 1994 earthquake. Since Tuesday, sales here have been slower, but are improving.

ED TIRITILLI, SEARS STORE MANAGER: The customer dictates when they want to come back into the marketplace. As soon as they have confidence again that -- in their jobs and their safety, they'll be coming back in.

WIAN: It took four years for consumer confidence to recover following the Gulf War. Before the World Trade Center and Pentagon attacks, confidence was already at its lowest level in nearly five years. This time, economists expect federal money for rebuilding, military needs and banking system liquidity will help keep cash in consumer hands.

PRESTON MARTIN, MARTIN ASSOCIATES: Anyone that wants to go into his or her bank branch and cash out their deposits -- well, you know the only question they'll be asked? "Would you like it in fifties or in hundreds?"

WIAN: Several retailers report customers buying plenty of what they need, but not much of what they want.

(on camera): Consumer reaction to the terrorist attacks will be included in next week's conference board report on consumer confidence. That should provide a clearer picture of what long-term impact the terrorists will have -- terrorist attacks will have on consumer spending -- Lou.

(END VIDEOTAPE)

LIN: Well what should have been a New Year celebration turns to a time of mourning.

HARRIS: Elizabeth Phil (ph) is going to explain how a Jewish congregation began Rosh Hashanah without some of its members.

(COMMERCIAL BREAK)

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com